Republicans aren't the only ones who want to change the financial reform bill. Sen. Bernard Sanders (I.) of Vermont has vowed to try to get the legislation to break up banks deemed 'too big to fail.' Here, Senator Sanders speaks at a news conference Wednesday.

Harry Hamburg/AP

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Washington

After three failed procedural votes this week, Senate Republicans Wednesday allowed Democrats to move financial reform legislation to the floor by unanimous consent.

Republicans say they won important concessions during the three days of delay, including assurances that Democrats would drop a $50 billion fund to be used in major bankruptcies. They claim that the money, which would have been collected from banks, would act as a permanent bailout fund.

But hopes among Republicans faded that they could address their other major concerns – including the powers of a new consumer-protection agency and the regulation of derivatives – though back-room negotiations.

With an impasse looming, Republicans relented. By doing so, they are conceding that the only way they can further change the financial reform bill is through amendments, which must get 60 votes to avoid a filibuster.

"It’s a clear sign that Republicans understood that they were losing this public relations battle,” says Norman Ornstein, a congressional expert at the American Enterprise Institute in Washington. “Now, they can continue negotiations, so both sides can declare victory and have a bill they can vote for.”

The decision to back a move to the floor doesn’t ensure passage. Democrats still need at least one Republican vote to pass the reform – and perhaps two votes, given that one Democratic senator, Ben Nelson of Nebraska, has been siding with the Republicans in their blocking techniques.

Weeks of debate ahead

Once the 1,400-page bill hits the floor, debate and votes on amendments could go on for weeks.

“We’re going to have a very busy couple of weeks coming up now,” said Sen. Christopher Dodd, who as the chairman of the Senate Banking Committee will be managing the bill on the floor. “There are lots of members who have very strong feelings about this bill.”

For one, Republicans hope to curb the proposed independent consumer protection agency – an agency that they say could harm small businesses that extend credit, including dentists, car dealers, and small manufacturers.

“This massive new bureaucracy would have unchecked authority to regulate whatever it wants, whenever it wants, however it wants," said Sen. Richard Shelby (R) of Alabama, the ranking member of the Senate Banking Committee. "I am aware of no other arm of the federal government this powerful, yet so unaccountable,” he said, adding that he could not support the bill in its current form.

Republicans will also seek to ease how the bill regulates derivatives. Speculation on derivatives was seen as a major contributing factor to the financial meltdown.

“A lot of people do derivatives, and they’re not just speculating,” says R. Bruce Josten, a lobbyist for the US Chamber of Commerce, which is opposing the bill. “If they force all the end-users to go through an exchange, all of this will be done in Singapore or Hong Kong. We will continue to run ads to oppose the draft bill.”

Democrats want to make changes, too

Meanwhile, liberals hope to use floor debate to strengthen regulation on a range of issues.

Foremost, perhaps, is an attempt to break up banks deemed "too big to fail." “If you have institutions too big to fail, then we have institutions too big to exist. We’re going to break them up,” said Sen. Bernard Sanders (I) of Vermont, who usually votes with the Democratic caucus. [Editor's note:The original version gave an incorrect party affiliation for Senator Sanders.]

He also has his eye on new transparency requirements for the Federal Reserve.

“During the bailout, the Fed lent trillions of dollars at zero or near-zero interest rates to large financial institutions," says Senator Sanders. "During the Budget Committee hearing, I asked Chairman Bernanke who received that money, [and] he refused to tell us."

“The bottom line is that trillions of taxpayer dollars were lent out and voters have a right to know who received it,” he added.

In the end, say Republicans, it was time to start debating the bill.

“Since the two senators [Dodd and Shelby] were unable to reach agreement, at this point it makes sense to proceed to floor debate,” said Sen. Susan Collins (R) of Maine, adding that she expects Senate majority leader Harry Reid to keep his “commitment to a free and open debate.”

[Editor's note:The original photo caption gave an incorrect party affiliation for Sen. Bernard Sanders of Vermont.]